Correlation Between Gan Yuan and Sichuan Jinshi
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By analyzing existing cross correlation between Gan Yuan Foods and Sichuan Jinshi Technology, you can compare the effects of market volatilities on Gan Yuan and Sichuan Jinshi and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Gan Yuan with a short position of Sichuan Jinshi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gan Yuan and Sichuan Jinshi.
Diversification Opportunities for Gan Yuan and Sichuan Jinshi
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Gan and Sichuan is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Gan Yuan Foods and Sichuan Jinshi Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sichuan Jinshi Technology and Gan Yuan is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Gan Yuan Foods are associated (or correlated) with Sichuan Jinshi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sichuan Jinshi Technology has no effect on the direction of Gan Yuan i.e., Gan Yuan and Sichuan Jinshi go up and down completely randomly.
Pair Corralation between Gan Yuan and Sichuan Jinshi
Assuming the 90 days trading horizon Gan Yuan Foods is expected to generate 0.92 times more return on investment than Sichuan Jinshi. However, Gan Yuan Foods is 1.08 times less risky than Sichuan Jinshi. It trades about 0.03 of its potential returns per unit of risk. Sichuan Jinshi Technology is currently generating about -0.01 per unit of risk. If you would invest 6,940 in Gan Yuan Foods on September 26, 2024 and sell it today you would earn a total of 1,938 from holding Gan Yuan Foods or generate 27.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gan Yuan Foods vs. Sichuan Jinshi Technology
Performance |
| Timeline |
| Gan Yuan Foods |
| Sichuan Jinshi Technology |
Gan Yuan and Sichuan Jinshi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gan Yuan and Sichuan Jinshi
The main advantage of trading using opposite Gan Yuan and Sichuan Jinshi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gan Yuan position performs unexpectedly, Sichuan Jinshi can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Sichuan Jinshi will offset losses from the drop in Sichuan Jinshi's long position.| Gan Yuan vs. Ming Yang Smart | Gan Yuan vs. 159681 | Gan Yuan vs. 159005 | Gan Yuan vs. Loctek Ergonomic Technology |
| Sichuan Jinshi vs. Zijin Mining Group | Sichuan Jinshi vs. Wanhua Chemical Group | Sichuan Jinshi vs. Baoshan Iron Steel | Sichuan Jinshi vs. Shandong Gold Mining |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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